momagri, movement for a world agricultural organization, is a think tank chaired by Christian Pèes.It brings together, managers from the agricultural world and important people from external perspectives, such as health, development, strategy and defense. Its objective is to promote regulationof agricultural markets by creating new evaluation tools, such as economic models and indicators,and by drawing up proposals for an agricultural and international food policy.

Communication CAP 2020 : The commissioner for agriculture has put all French union on the same page…against him !

Jacques Carles, Chief Operating Officer of Momagri and President of Carles & Associés, and Frédéric Courleux, Advisor of Momagri and Carles & Associés

November 27, 2017

Launching a new community negotiation, the Commissioner Phil Hogan presented last November 29th a communication on the orientations of the future CAP post 2020. First reactions came quickly and, on the French agricultural unions there is a rare consensus: an extra step towards the renationalization of the main community policy is criticized on all sides.

Two displayed orientations are provoking this rage: the Commission is leaving the door open to a national co-financing of producer payments on the one hand, and more importantly they wish to give member States full latitude to establish their strategy in environmental and agricultural matters on the other hand. What farmers are denouncing by talking of renationalization is the creation of new competitive distortions between and within Member states. That richer countries or regions may have the right to support their farmers’ income more is a problem to them, and quite rightly so, since it would be undercutting one of the foundations of the European Single Market.

Recent events has shown it again with the manure fraud in the Netherlands, what producers are refusing are double standards for rules throughout Europe. And even more so since we are increasing the European level of requirements, without any assurance that imports will have to comply as well, all the while announcing future reductions for budgets. In other words making more with less.

The European Commission doesn’t seem to have integrated that the so called “negotiated” approaches for environmental matters and based on an obligation of result and not means, an approach she has obviously adopted in the communication, were a Dutch political innovation. Knowing that the environmental policy is on a EU-level jurisdiction, it is significant to witness thereby the expression of a “not-enough-Europe” coming from agricultural unions.

Other subject on which the renationalization is criticized during these times of agricultural crisis : the protection of farmers against market instability. The commissioner keeps putting forward private risk management tools such as insurances and mutual funds ; tools which we know that they aren’t of any use when markets are depressed several years in a row. These instruments have already been added to the CAP during the last reform, but Member States haven’t implemented them, judging them widely inadequate.

We could have expected some conclusions to have been drawn and that on the contrary the Commissioner would have made the promotion of his main success, namely the production reduction scheme that had a remarkable effect at the end of 2016 to exit the milk crisis. Not of that happened, and the subject of crisis management remains a taboo in Brussels. It should appear as a novelty to not simply give out payments during crises but to take advantage of it to ask farmers to produce less and therefore rebalance offer and demand.

Finally, only true novelty, the Commissioner wishes to add th migration subject to the CAP, by reminding us that rural development aid in particular can be used to welcome migrants in European countryside. We can only wonder given that, with a lack of tools to protect farmers from the volatility of international markets, as most OECD countries do, the sacrifice of the youngest and most indebted farmers remains the go-to solution to solve crisis in Europe.

In these conditions, it is going to be difficult for the European Executive to sell the experience of the CAP as a strategy to reduce the migratory phenomenon. And, moreover, adding this new Objective to the CAP without any perspective of increased resources could bring new outraged reactions from the agricultural community, considering itself as the main contributor to the resolution of humanitarian tragedy coming from afar, with the politician exploitation risks associated to it.

In the end, if this communication from the Commission sets itself in the renationalization trajectory, let’s hope that member states and the European Parliament will know how to give a federative political ambition to change the course of a CAP that is today running opposite to the other agricultural policies in the world.